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Mexico, Colombia Groups Compete for US Heroin Market

March 31, 2016

Mexico, Colombia Groups Compete for US Heroin Market

March 29, 2016 – (Insight Crime)Criminal organizations based in Mexico are challenging the traditional dominance of Colombian groups over the heroin market in the eastern United States, signaling shifts in drug production and trafficking patterns in both Latin American countries.

According to recent congressional testimony provided by Drug Enforcement Administration (DEA) official Louis J. Milione, Mexican crime groups “are now competing for the East Coast and Mid-Atlantic markets by introducing Mexican brown/black tar heroin as well as by developing new techniques to produce highly refined white powder heroin.”

In the past, Mexican traffickers typically supplied lower-quality black and brown tar heroin to smaller markets in the western United States, while Colombians supplied higher-quality white powder heroin to lucrative big city markets on the East Coast. The move towards producing white powder heroin suggests that Mexican groups intend to compete with their Colombian counterparts in terms of both quality and quantity.

These developments have not gone unnoticed. InSight Crime has previously reported on the huge increase in opium poppy cultivation and the growing sophistication of heroin production in Mexico in recent years. These trends have been linked to the rising demand for heroin in the United States as well as the declining profitability of trafficking other drugs like cocaine and marijuana.

Milione’s testimony also touched on a relatively recent phenomenon associated with heroin trafficking: the addition of the highly potent synthetic opioid fentanyl into heroin sold on the US market. Milione said the DEA has become “increasingly alarmed” by this development, and has issued national alerts to inform law enforcement about the dangers of the drug.

A recent investigation by the US news outlet Fusion revealed that Mexican heroin producers have begun producing fentanyl-laced heroin, which is known as “el diablito” (the little devil) because of its potential for causing addiction. According to the investigation, some Mexican producers of fentanyl-laced heroin have obtained the precursor chemicals from Chinese suppliers and have paid Colombian chemists to teach them how to make the drugs.

“There’s almost nobody making pure heroin anymore, because el diablito is so much stronger,” one trafficker told Fusion.

InSight Crime Analysis

With so much focus on the changing dynamics of the Mexican heroin trade, some observers have wondered whether shifting patterns of production in Colombia have been overlooked.

According to a 2015 report from the United Nations Office on Drugs and Crime (UNODC), opium poppy cultivation in Colombia rose by almost 30 percent between 2013 and 2014, to 387 hectares — the highest level observed since 2008. Moreover, according to the US State Department, heroin seizures in Colombia also ticked up from 349 kilograms in 2014 to 393 kilograms in 2015, suggesting a possible increase in production.

Colombian organizations appear to have shifted their focus from low-level distribution to large-scale production.

In contrast, according to a recent assessment by the DEA, Mexican criminal groups have developed extensive relationships with retail-level drug distributors in the United States. These relationships have allowed Mexican organizations to push their own products into markets previously controlled by Colombian groups, like those on the East Coast.

While the DEA assessment notes that Colombian heroin continues to dominate markets in the eastern United States, this could change as Mexican heroin makes up an increasing share of the US wholesale market.

In addition to these developments, Payne said the DEA is paying close attention to the introduction of fentanyl-laced heroin coming from Mexico.

“Fentanyl is a really big problem right now,” he said. “What we’re finding is that it’s being mass produced,” particularly in China, where labs “are manufacturing huge amounts of all different kinds of fentanyl analogs.”

Payne said that fentanyl is especially worrisome for anti-drug authorities due to its extraordinary potency, which translates not only into addiction and overdoses, but also high profits for criminal groups.

“You only need to get a small amount of this stuff across the border to make a lot of money,” Payne said.